Authored by the expert who managed and guided the team behind the Nigeria Property Pack
Yes, the analysis of Lagos' property market is included in our pack
If you're reading this, it's likely that the vibrant city of Lagos has caught your eye, and you're thinking about investing in an apartment there.
But what does the buying process entail? Is it straightforward or filled with hurdles? How long should you expect it to take? What challenges might you face along the way?
In this article, we'll walk you through each step of the journey.
Actually, we know this market inside and out. We keep tabs on it regularly, and all our discoveries are reflected in the most recent version of the Nigeria Property Pack
The Steps to Buy a Condo in Lagos, Nigeria
- 1) Research and Identify the Property
- Conduct thorough research on the Lagos real estate market, focusing on areas like Victoria Island, Ikoyi, and Lekki, which are popular for condos.
- Engage a reputable local real estate agent who understands the market dynamics and can provide insights into property values and neighborhood specifics.
- Visit potential properties to assess their condition, location, and amenities, ensuring they meet your requirements and budget. - 2) Verify Property Documentation
- Request and review the property's title documents, such as the Certificate of Occupancy (C of O) or Governor's Consent, to confirm legal ownership.
- Engage a local property lawyer to conduct due diligence, ensuring there are no encumbrances or legal disputes associated with the property.
- Verify the developer's credentials and past projects if buying off-plan, to ensure reliability and quality. - 3) Negotiate and Make an Offer
- Discuss the price and terms with the seller or their agent, considering the current market conditions and comparable property prices.
- Make a formal offer in writing, outlining the proposed purchase price and any conditions or contingencies.
- Be prepared to negotiate, as bargaining is a common practice in Lagos real estate transactions. - 4) Secure Financing
- If financing is needed, approach Nigerian banks or international lenders that offer mortgage services to foreigners.
- Prepare necessary documentation, such as proof of income, credit history, and identification, to support your loan application.
- Compare interest rates and terms from different lenders to secure the best financing option. - 5) Draft and Sign the Sales Agreement
- Have your lawyer draft a sales agreement that includes all agreed terms, conditions, and timelines for the transaction.
- Review the agreement carefully, ensuring it covers all aspects of the purchase, including payment schedules and transfer of ownership.
- Both parties should sign the agreement, and it should be witnessed by legal representatives to ensure its validity. - 6) Complete Payment and Transfer Ownership
- Make the agreed payments as per the sales agreement, ensuring all transactions are documented and receipts are obtained.
- The seller should provide all necessary documents for the transfer of ownership, including the Deed of Assignment.
- Register the property with the Lagos State Land Registry to formalize the transfer and secure your ownership rights. - 7) Pay Taxes and Fees
- Calculate and pay the necessary taxes, such as the Stamp Duty and Capital Gains Tax, as required by Nigerian law.
- Settle any additional fees, including legal fees, agency fees, and registration fees, to complete the transaction.
- Keep all receipts and documentation for future reference and compliance purposes.
Get the full checklist for your due diligence in Nigeria
Don't repeat the same mistakes others have made before you. Make sure everything is in order before signing your sales contract.
What You Need to Know Before Buying an Apartment in Lagos, Nigeria
What are the initial steps to take when considering buying an apartment in Lagos?
The first step is to conduct thorough research on the neighborhoods in Lagos to understand the market trends and property values.
Engage a reputable real estate agent who is familiar with the Lagos property market to guide you through the process.
Ensure you have a clear budget and financing plan, including pre-approval for a mortgage if necessary.
How much should I expect to pay for an apartment in Lagos?
The cost of an apartment in Lagos varies significantly depending on the location, size, and amenities.
On average, a two-bedroom apartment in a prime area like Victoria Island can cost between ₦50 million and ₦150 million.
In less central areas, prices can range from ₦20 million to ₦50 million for similar properties.
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What are the legal requirements for purchasing property in Lagos?
Buyers must ensure that the property has a valid Certificate of Occupancy (C of O) or Governor's Consent, which are crucial legal documents in Nigeria.
It is advisable to hire a property lawyer to conduct due diligence and verify the authenticity of the property's title documents.
All transactions should be documented with a Deed of Assignment, which transfers ownership from the seller to the buyer.
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=> What are the legal requirements for buying property in Lagos?
Are there any additional costs involved in buying an apartment?
In addition to the purchase price, buyers should budget for legal fees, which are typically 5% to 10% of the property value.
There are also agency fees, which can be around 5% of the purchase price, and other miscellaneous costs such as survey fees and stamp duties.
It is important to factor in these additional costs to avoid any financial surprises.
How long does the property buying process typically take in Lagos?
The duration of the property buying process can vary, but it generally takes between 3 to 6 months from start to finish.
This timeline includes property search, negotiation, legal checks, and finalizing the transaction.
Delays can occur due to issues with title verification or obtaining necessary approvals from government agencies.
Buying real estate in Nigeria can be risky
An increasing number of foreign investors are showing interest in Nigeria. However, 90% of them will make mistakes. Avoid the pitfalls with our comprehensive guide.
What financing options are available for purchasing an apartment in Lagos?
Buyers can opt for mortgage loans from Nigerian banks, which typically offer interest rates ranging from 15% to 25% per annum.
Some developers offer installment payment plans, which can be a flexible option for buyers without immediate full payment capacity.
It is crucial to compare different financing options to find the most favorable terms and conditions.
What should I know about property taxes and levies in Lagos?
Property owners in Lagos are required to pay Land Use Charge, which is a consolidation of all land-based rates and charges.
The amount payable depends on the location and size of the property, with rates typically ranging from 0.076% to 0.256% of the assessed property value.
Failure to pay these charges can result in penalties or legal action by the Lagos State Government.
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How can I ensure the property is free from encumbrances?
Conducting a thorough title search at the Lagos State Land Registry is essential to confirm that the property is free from encumbrances.
Engage a qualified property lawyer to verify that there are no existing mortgages, liens, or legal disputes associated with the property.
Obtaining a certified true copy of the title documents can provide additional assurance of the property's status.
What are the common pitfalls to avoid when buying an apartment in Lagos?
One common pitfall is failing to conduct adequate due diligence on the property's title and ownership history.
Another mistake is not budgeting for additional costs such as legal fees, agency fees, and taxes, which can add up significantly.
It is also important to avoid making payments without proper documentation and legal oversight.
Is it advisable to buy off-plan properties in Lagos?
Buying off-plan properties can offer lower prices and flexible payment plans, but it comes with risks such as project delays or non-completion.
It is crucial to research the developer's track record and ensure that all necessary approvals and permits are in place before committing.
Engaging a real estate lawyer to review the contract terms can help protect your interests in off-plan purchases.
What role does a real estate agent play in the buying process?
A real estate agent can provide valuable insights into the Lagos property market and help identify suitable properties based on your criteria.
They assist in negotiating the purchase price and terms, ensuring you get the best possible deal.
Agents also facilitate communication between the buyer, seller, and other parties involved, streamlining the transaction process.
How can I verify the credibility of a real estate agent in Lagos?
Check if the agent is registered with the Nigerian Institution of Estate Surveyors and Valuers (NIESV) or the Real Estate Developers Association of Nigeria (REDAN).
Request references from past clients and conduct online research to read reviews or testimonials about the agent's services.
Meeting the agent in person and discussing their experience and approach can also help assess their credibility and professionalism.